Berkshire Profit Hurt by Insurance Units

Berkshire Hathaway Inc., the company controlled by billionaire Warren E. Buffett, said third-quarter profit from operations fell 41%, but profit including investment gains was up 15%. Continued weakness at two of the company’s major insurance holdings, General Re and Geico, pulled profit from operations down to $156 million, or $103 a Class A share, from $264 million, or $212 a share. Net earnings including realized investment gains, rose 15% to $420 million, or $276 per Class A share. Revenue more than doubled to $7.05 billion from $2.9 billion. Operating profit at Berkshire’s General Re unit declined because of rising claims for catastrophes and competition in the reinsurance industry that has kept premiums low, Berkshire said. The Geico auto insurance unit also saw a decline in underwriting profit as it cut premiums and spent more on advertising to win customers. The results were announced after the close of trading on the Big Board, where Berkshire’s Class A shares gained $1,100 to close at $60,300, and its Class B shares advanced $10 to close at $1,968.